Tuesday, August 23, 2016

Injury at Work – The Risk and Cost

Insuring your business and the
people who work for you is just common sense. Besides, the obligation
you have towards your employees, claims for compensation for sickness or
injuries in the workplace, can be huge. But your employees may not be
the only ones who work in your business premises. What about contractors
and their subcontractors?

It Could Happen To You

Compensation
to employees of contractors and their sub-contractors who are injured
while working at site is a complicated and often contentious issue. The
contractor may claim that all the required coverages are in place, but
if an accident occurs and they are not, the liability could fall on you,
and the primary employer. That is what happened recently at the new
Tesla electric vehicle plant. A worker of a subcontractor working on the
expansion of the factory was injured while on the job. It soon emerged
that the subcontractor was in violation of employment laws and in breach
of regulations regarding wages, overtime and workers comp.

Tesla
had no knowledge of this, but when the facts came to light, they were
dragged to court along with the subcontractor. The end result? The
injured employee was awarded a $550,000 settlement.

Tesla
is a huge organization with a vast amount of financial muscle. They
will be able to absorb the monetary shock of the settlement. But what if
something similar happened to you? The courts do not award settlement
based on the ability of the employer to pay. It is on the basis of the
amount of injury and the liability for it. In the Tesla case, the worker
had fractured legs and ribs and a concussion. These are major injuries
but, sadly, not uncommon in such cases. Would you be able to absorb a
half million dollar payout? Or would that ruin you?

Get the Protection You Need

The
vast number of insurance products available can be confusing to anyone
who is not an insurance professional. Many business owners think they
have the coverage they need when they do not. Part of the reason is the
confusion that exists about coverage types. For example a person may
read about employment practices liability insurance (EPLI) coverage and
presume that since he has liability coverage, he is already protected.
Not so. Liability coverage and EPLI are different and both are critical
to protecting your business.

Remember
that insurance is not a gamble, a luxury or just an expense. It is the
shield that will protect you when you are faced with liabilities that
could ruin you and your business.

When
business imperatives demand that contractors need to be employed, the
amount of paper work involved can be voluminous. Issues like workers
compensation can easily fall through the cracks.Therefore, you as the
principle employer must ensure that the contractors provide proof of
their insurance coverage and that they add you as an additional insured
party on the policy so that you are not in the firing line if things go
wrong. In addition talk to your insurance agent to understand your
possible liability and the claims that could be raised against you and
get the insurance coverage you need to protect yourself and your
business. If you do not have workers comp, liability coverages and EPLI
you are leaving yourself dangerously exposed.

About Allied Brokers

Allied Brokers is a full-service insurance brokerage. Founded in 1954, we provide insurance products throughout California and several other states. We have insurance policies and services for any of your insurance needs: Auto, Homeowners, Condominiums, Apartments, Earthquake, Flood, Renters, Business, Health, Life, Motorcycle, Boat, RV and Estate Planning. Experience the "can do" attitude of our agents.